Globalisation Flashcards
What is globalisation?
international interconnectedness and interdependence of people with an integration of economies, where there is a fundamental transformation of economic, social, political and cultural forces
-lengthening, deepening, faster connections
What happens if there is a deeper depth of global connections?
country is more integrated
What is a throwaway society?
society strongly influenced by consumerism
What factors of globalisation lead to connections and interdependence
capital commodities information tourists migrants
How has transport and trade interlinked in the 19th and 20th Centuries until now?
- constant feedback loop
-transport has allowed trade to grow - 19th Cent Ford and other manufacturers were able to export
- innovations in transport and trade:
19th Cent steam power, railways, telephone, telegraph,
20th Cent container ships, jet aircraft
What are the four strands of globalisation?
economic, social , political, cultural globalisation
What does spec say globalisation has accelerated due to?
rapid developments in
transport,
communications
and businesses.
What has the 21st Century been dominated by leading to more globalisation (spec)?
rapid development
in ICT and global communication (mobile phones, internet,social networking, electronic banking, fibre optics),
therefore lowering communication costs and contributing to time-space compression.
What helps economic globalisation?
TNCS, tech
What helps social globalisation?
international immigration
improvement in healthcare and education
online connectivity
What helps political globalisation?
trading blocs
World Bank, IMF, WTO
BRICs
MINT
What is in Bretton Woods Agreement?
WTO, World Bank, IMF
Difference between IMF and World Bank aims?
IMF wants to stabilise the world’s monetary system
World Bank wants to reduce poverty by providing assistance
What system did IMF set up? Why?
system of fixed exchange rates with the dollar as the international currency
to ensure global economic stability
What does World Bank do?
lend money often to developing countries to reduce poverty
Controversial World Bank
SAPs
Economic before social development
What does WTO do?
helps importers/exporters trade freely and smoothly w/ rules framework for trade agreements
What are IMF, World Bank, WTO all?
IGOs
5 trade blocs
EU OPEC ASEAN Mercosur NAFTA
Who is in OPEC?
African, S American, Middle East countries
Who is in ASEAN?
SE Asian countries (clue is in name)
Who is in Mercosur
South American countries
Argentina, Brazil, Paraguay and Uruguay
Who is in NAFTA?
Canada, Mexico, and the United States
Advantages of free trade blocs
- helps developing countries
- no tariffs
- free borders
- large market
- promotes local goods
Cons of trade blocs
- hard to get out of
- loss of sovereignty
- interdependence
- comp
What does spec say national govs are key players in in terms of ….
- promoting free trade blocs
- polices (free-market liberalisation, privatisation,
encouraging business start-ups).
What does spec say WTO, IMF, World Bank have contributed to globalisation through the promotion of…..
free trade policies and
foreign direct investment
What is free-market liberalisation/neoliberalism?
-removing government control and opening up the markets to privatisation, which will lead to capitalism, and therefore wealth
Characteristics of neoliberalism
privatisation stopping regulation corruption business start up encouragement spending cuts, especially on welfare free trade integration into global economy
Why was deregulation of City of London 1986 beneficial?
made it world’s leading global hub
How is neoliberalism imposed by IMF and World Bank?
SAPs
What are SAPs?
capitalist structural adjustment loans to remove gov controls and promote neoliberalism, with privatisation and lower tariffs, but cut health spending, leading to lower health status and social development
How has China changed its attitudes and economy? dates too
- 1970 poor
- 1976 Mao died
- 1978 Deng Xiaoping introduced Open Door Policy, leading to more privatisation
- 1980 joined World Bank and IMF, as well as four SEZs, bringing in FDI
- 1990 stock markets in Shanghai and Shenzhen opened up
- so in 90s, half a billion were lifted out of poverty
Is China completely open door?
YES - foreign TNCs can invest, FDI predicted over $1 trillion
NO - banning of foreign social media, only 34 foreign films screened p/year, strict controls on foreign TNCs
How has UK gov accelerated globalisation?
tax breaks +subsidies to companies who invest (most Canary Wharf companies given this)
subsidies to foreign manufacturing companies here
Four SEZ zones China 1980
Xiamen
Shenzhen
Zhuhai
Shantou
How has China accelerated globalisation?
open door policy 1978
welcomed foreign businesses ,as it needed Western tech
biggest recipient of FDI
investing in USA, EU, Africa
What are the diff types of FDI
offshoring
foreign mergers
foreign acquisitions
transfer pricing
What is offshoring
locating overseas for cheaper costs
Example of offshoring
Fender opened plant in Mexico in 1987
What is foreign acquisition
a TNC takes over company in another country
Example of foreign acquisition
2010 Kraft took over Cadbury
What is transfer pricing?
Companies put profit in lower taxed country for lower tax
Example of transfer pricing
Starbucks and Amazon have put profits through Ireland, (low taxed)
What is the KOF Index?
measures degree of globalisation with economic, social, political indicators
What are the two indexes that measure globalisation?
AT Kearney index,
KOF index
Why is KOF Index perhaps not modern enough?
made in 1970
factors such as TV ownership are less relevant
What type of globalisation does KOF Index put most weight on and least?
social
least on political
Why does KOF Index perhaps not show USA and China as globalised and can be criticised for?
- they are more self-sufficient
- so indicators such as barriers to trade may not be relevant
Indicators in KOF Index (2 for each type)
FDI
Barriers to trade
No of Embassies
No of UN Peace missions
TV Ownership
No of Mcdonald’s Restaurants
What is the AT Kearney Index?
measures globalisation with four factors: political engagement technological connectivity personal contact economic integration
How is AT Kearney Index diff from KOF Index?
more holistic indicators, such as no of web servers rather than internet communications
Who were top 4 of AT Kearney Index 2015?
Sing.
Switz.
US
Ireland
What is the AT Kearney World Cities Index?
-a measure of how economically successful cities are
and includes TNC headquarters, museums, embassies
Who was top 4 AT Kearney World Cities Index 2016?
London
NY
Paris
HK
Why do some areas remain switched off (physical)?
- poor agriculture
- land locked (Niger)
- natural hazard vulnerable (Mozambique)
Why do some areas remain switched off (human)?
- corruption
- lack of skills deters investment
- politically isolated (NK)
- low prices for food exports due to overproduction
- ethnic clashes between tribes (DRC) hinder progress
What is a global production network? Example?
chain of suppliers of parts and materials that contribute to production of goods
Apple
Diff between outsourcing and offshoring
Outsourcing is when work is carried out in another country
offshoring is when it is overseas
How many suppliers does Kraft have for ingredients?
30,000
What is Just in Time?
companies lessen time between when product is produced, and when it is delivered, to cut costs
What is motive, means and mobility?
TNCS have shared motive to make money, and have the means to do so, and the mobility to carry goods and communicate
How have Taiwan, Vietnam, Kenya and the EU been influenced by globalisation?
- Taiwan had sweatshops in 60s due to change in gov, then increasing workers, wages, and most competitive survived (Acer), so their democracy helped them trade
- Vietnam has had Nike sweatshops so more children go school, higher wages, internal migration to South
- Kenya’s gov has meant glob. is hindered, as people can’t own land, export restrictions, black market, protectionism, sales tax, but phones have helped
- EU’s lower tariffs on Kenya’s flower exports has helped Kenya become leading flower exporter
Which two countries are good examples of how the global economic centre of gravity has shifted to Asia?
India
China
Why has Apple opened its first development centre in India?
to develop Apple Maps
high skilled yet cheap workers there
What will Apple’s new development centre in India bring?
4000 new jobs
How much of the Indian IT industry does Bangalore have?
40%
How many workers does the Indian IT industry in Bangalore employ?
nearly 10 million
Benefits of global shift to India
- less unemployment
- call centre workers paid better
- economic growth by 6%/yr
- more billionaires than UK
- inspiring young entrepreneurs, such as EKO India Financial Services
- growing middle class w/ more disposable income
Costs of global shift on India
- overcrowding
- still 60% of Mumbai in slums, who cannot work in services
- widening income inequality
What percentage of the world’s computers does China manufacture?
50%
Who is the largest recipient of FDI?
China
Benefits of global shift for China
- decreased poverty from 60% (1990) to 10%
- improved transport such as high speed rail between Beijing and Guangzhou
- more uni graduates
- more middle class w/ disposable income
Costs of global shift for China
- pollution of water (Chongqing 80/101 forbidden toxins in tap water
- air pollution = smog
- sweatshops violate human rights
- farmland degrading - 40%
Benefits of all global shift according to Spec 3.4a
infrastructure investment waged work poverty reduction education training
Costs of global shift according to Spec 3.4a
loss of productive land
unplanned settlements
environmental and resource pressure
What have some communities in developing countries experienced due to global shift 3.4b
major environmental problems including air and water pollution land degradation, over-exploitation of resources loss of biodiversity, which impact on people’s health and wellbeing.
Some deindustrialised regions in developed countries face
what social and environmental problems as a result of economic restructuring EQ2 3.4c
dereliction contamination depopulation crime high unemployment
What does the Clark Fischer Model show?
how different sectors (primary, secondary, tertiary, quaternary) rise and fall going through pre-industrial and post-industrial stages
What percentage of UK is tertiary ?
over 80%
Why has the UK economically restructured (shifting from a manufacturing to a service sector)?
- mechanisation
- deindustrialisation
- reindustrialisation
- tertiarisation
What was announced about Redcar steelworks?
Thailand’s SSI announced it would be closing down
How many job losses from Redcar closing down?
2200, as well as 900 in the supply chain
What was Redcar named after it closed?
‘ghost town’
What are threats to the UK steel industry?
- less demand
- competition from China who have lower prices
- high costs of energy production
- climate change policies adding costs
- not enough gov compensation
- EU rules restricting support
How much less is Chinese steel sold for?
300 less euros per tonne
Why do people believe it is important to save the British steel industry?
- steel is vital
- job losses - 18000, if gone
- detrimental impact on other sectors
What could the government do to save the British steel industry?
- cut energy costs
- lessen other steel imports
What is a megacity?
a city that has more than 10 million people
Two terms for main causes for pop growth in megacities?
natural increase
rural-urban migration
How many international migrants live in foreign countries?
250 million
What are million cities?
cities with pop over 1 million
Where are most megacities?
Asia have most
Americas
Middle
East
In which continent are megacities growing most rapidly?
Asia
What two resources have helped global hubs develop?
natural resources
human resources
What are the natural resources that have helped global hubs develop?
oil
coastlines
low relief
good location
What are the human resources that have helped global hubs develop?
large labour forces
affluence attracts FDI
skilled labour
multi-lingualism
Three types of movement that have helped global hubs grow?
internal migration
elite international migrants migrating
low waged international migrants
How much of UAE’s workforce is low skilled international migrants?
90%
Which country has invested in the Shard and Canary Wharf?
Qatar
What proportion of foreign residential purchases 2004-2014 were Russian?
a third
Benefits of migration to host region?
- less skill shortages
- migrants willingly pay more rent
- good form of soft powe
- diversity
Costs of migration to host region?
- social tensions can lead to rise of far right parties, who then support racist immigrant restrictions
- polarization
- over-dependence
- more greenhouse gas emissions (China)
Benefits of people migrating from source region?
- migrants return with new skills (Indian health clubs)
- remittances
- better policies to encourage people to come back
- industrial land used for farming again
How much of Nepal’s national income in 2015 was remittances?
25%
Costs of people migrating from source region?
- less young, skilled people
- more international aid needed
- services close, such as nightclubs in Warsaw 2004
widening development gap extremities and disparities in
environmental quality are a result of what process?
globalisation
What is development?
progress economically, environmentally, politically, culturally, socially
by improving quality of life
Economic Indicators of development
HDI
GNI
GDP
What does the development continuum show ?
how economic developed cities or countries are in comparison with each other
How are countries placed on a development continuum?
they are placed at points on this line
least developed—————————-most developed
What are the single economic indicators of development?
GNI
GDP
What is GNI an acronym for ?
Gross National Income
What is GNI?
total goods and services produced per year + net income locally and internationally - payments to other countries
OR
total income of pop
What is GNI usually expressed as ?
per capita / person
How is GDP slightly different to GNI?
does not include foreign earnings
What is GDP sometimes expressed in which takes cost of living into account?
purchasing power parity
Why is GDP sometimes expressed in purchasing power parity?
low cost countries will have higher GDP as it is more equal
What is a composite economic indicator?
Economic Sector Balance
What is Economic Sector Balance? Example Vietnam
- what proportion the diff sectors have and how they contribute to GNI
- in Vietnam the secondary sector has risen when primary sector has fallen
Which model shows Economic Sector Balance?
Clark-Fischer Model
Four limitations of economic indicators of development?
- not always representative, as poverty in emerging countries decreases economic indicators, and elite could skew the GDP upwards
- not always accurate if there is large informal sector
- difficult to compare if PPP is not taken into account
Single social Indicators of development
Infant Mortality Rate Literacy rates Enrollment in schools % Undernourished Corruption Index
Composite social indicators of development
HDI
GII
Happy Planet Index
GINI coeffient
What does HDI rank countries according to?
Health
Education
Living Standards
What is used to measure health for HDI?
life expectancy
What is used to measure education for HDI?
mean years of schooling, expected years of schooling
What is used to measure living standards for HDI?
GNI per capita
What place is Australia’s HDI globally?
2nd
What is the average years in education in Australia? (it’s good)
12 years
What does GINI Coefficient show?
income inequality
What proportion of countries publish GNI, and why don’t some publish it?
1/3
reluctant
What is the diff between absolute poverty?
absolute is when you can’t even meet basic needs.
relative is when u can meet basic needs, but not to maintain the average standard of living
Is North Africa switched on or off to globalisation?
switched on
What has helped North Africa be switched on to globalisation?
- French outsourcing
Why has Africa been a loser of globalisation?
- slow income growth
- inequality still in Sudan, Ethiopia, landlocked areas with politically corrupt governments
Is income inequality increasing or decreasing everywhere?
increasing
Pros of HDI
- composite indicator, so holistic approach
- shows the benefits of development to people
- enables comparisons over time, as it has been measured for over 150 years
Cons of HDI
- doesn’t consider environmental costs of development
- could be based on unreliable data, as some countries do not have sophisticated methods
- does not show inequality
What is GII an acronym for ?
gender income inequality
How does GII measure ?
reproductive health
empowerment
labour force participation rate
Which continents have most GII?
South America
South Asia
parts of Africa
Limitations of social indicators of development?
- hard to quantify some indicators like freedom of speech
- some are misleading for development, as e.g high death rate could still be in a developed country
- unreliable data in low income countries
How do we show inequality?
Lorenz Curve
Gini Coefficient
Where is air pollution causing premature deaths?
Chongqing
Example of losing due to globalisation Bangladesh
mangroves cleared for prawns
What has forest cover decreased from and to on Negros, a Philippine Island?
90% to 4%
Why did Rio close Jardin Gramacho landfill?
leaking toxic waste onto bay
What was the landfill called that Rio closed to promote recycling?
Jardin Gramacho
Where is rubbish now managed in Rio?
Solid Waste Treatment Centre
Where are residents encouraged to put rubbish compared to before?
bins
instead of around favelas
What principle have Rio made for recycling?
Reduce-Reuse-Recycle-Hold Liable
What have Rio started using the abundant algae for ?
fertiliser
What is the five tier system for immigration in the UK?
Tier 1 - high value Tier 2 - skilled workers Tier 3 - lower skilled workers Tier 4 - students Tier 5 - temporary workers
How has globalisation led to loss of control in goods on the Mekong River Delta?
- higher demand then supply, so there have been 2000 international disputes on who can use which part of the river, what they can do there
- so Mekong River Agreement set up
- transboundary conflict with dams, e.g China HEP dams economically develop area, but displaces Cambodians
When was the Mekong River Agreement set up?
1995
Who are Canada First Nations?
aboriginal Canadian group
How is Canada First Nations (aboriginal group in Canada) protecting the environment?
watch over endangered bears
note and stop changes in the area
negotiate treaties to reclaim land
Why does Canada First Nations negotiate treaties to reclaim land?
- it was originally Indigenous, but there were historical grievances of mismanagment
- believe people should live in harmony with the environment
What does Fairtrade advocate for?
fairer prices
better conditions
sustainability
fair terms of trade
How do people in the developed world have the power by buying Fairtrade?
helps address injustices the poorest producers face
Cons of Fairtrade (5)
- a lot to apply - 2004 Euros, so richer farmers benefit more
- sometimes goods, such as coffee, will be still still sold at lower market rates, as importers will simply not buy it otherwise
- farmers often still earn same income
- mixed reviews of fairtrade
- farmers cannot go up in sectors, as they only get Fairtrade Premium if they are producing the crops that locked them in poverty
- becoming harder to ensure money is distributed as Fairtrade grows
What did Green and Black’s new bar in 2017 have on its label instead of another?
Cocoa Life certification instead of Fairtrade
Why is it okay that the Green and Black’s new bar in 2017 had Cocoa Life on it?
- in partnership with Fairtrade
- still sustainable
- competitive prices
Con of Cocoa Life on Cadbury bars
not according to Fairtrade Standards of certification
What is the local sourcing solution?
sourcing products and services from local areas instead of internationally
Pros of local sourcing solution
- reduces carbon footprint with shorter supply chains
- benefits local suppliers
- local preferences more easily met
Cons of local sourcing solution
- business may become over-dependent on customer
- less economical development in not local places such as Ivory Coast
- can increase carbon footprint when tomatoes are grown in heated greenhouses
What is Todmorden trying to do?
local food for all
How is Todmorden promoting local sourcing solution?
- unpaid volunteers grow fruit and veg for everyone
- tours for over 1000 visitors
- free Harvest festival
- free talks - Stephen Barstow, world-famous author and grower
Why is Todmorden promoting local sourcing solution?
less food miles, more locally sustainable and beneficial, more people locally benefit with jobs
What event incited high fashion brands to be more ethical? Year?
Raza Plaza factory collapse 2013
What accord did H&M sign to be more ethical?
Bangladesh Safety Accord
What is the Bangladesh Safety Accord?
contract to make inspections of 1000 factories
How transparent have H&M been with partial supplier list?
transparent
What do campaigners want H&M to be more ethical?
better living wages for workers
Why is Topshop not ethical?
- led by Arcadia, who never signed up to the Bangladesh Accord in 2013, and never joined the Ethical Trading Initiative, which is a very basic step to be more ethical
How ethical has Zara been?
mixed - did compensate Bangladesh factory collapse victims and there are good trade unions
- but it is ambiguous how many clothes are made in Europe, and some argue Zara is one of the worst players in fast fashion
What do Gap and Nike do to prevent worker exploitation?
prohibit it
Why is it hard to monitor worker exploitation?
so many factories
hard to control suppliers of suppliers
Two examples of how NGOs are helping be ethical
- Charity War on Want helped South African pickers
- Tesco told farm it would use diff fruit supplier until conditions improved
